GST/HST Accounting & Filing in Canada
GST/HST accounting tracks tax collected on taxable sales and eligible input tax credits on business purchases. For most businesses, mandatory registration depends on exceeding $30,000 in worldwide taxable supplies, including associates, in one calendar quarter or over four consecutive quarters. Different timing rules apply to each test. Accountants Online provides GST/HST registration assistance, return preparation and filing online for businesses across Canada.
Written by the Accountants Online Tax Team · Last reviewed: September 11, 2026 · Tax year: 2026
What is GST/HST
The Goods and Services Tax (GST) is a 5% federal tax on most taxable supplies in Canada. HST is 13% in Ontario, 14% in Nova Scotia since April 1, 2025, and 15% in New Brunswick, Newfoundland and Labrador, and Prince Edward Island. The applicable rate depends on the place-of-supply rules. Businesses registered for GST/HST collect it on taxable sales, claim input tax credits on tax paid on business purchases, and remit the difference to the CRA.
When you must register
For most businesses, the small-supplier limit is $30,000 of worldwide taxable supplies, including associated persons, both in a single calendar quarter and over four consecutive quarters. If you exceed it in one quarter, GST/HST applies to the supply that takes you over the limit. If you exceed it over four quarters but not in one quarter, small-supplier status ends at the end of the following month. Registration is required within 29 days of the effective registration date. Public service bodies and certain activities, including taxi and commercial ride-sharing services, have different rules.
Filing periods and deadlines
- Monthly filers: return and payment due one month after the end of each reporting period.
- Quarterly filers: due one month after the end of each quarter.
- Most annual filers: file and pay three months after fiscal year end. Sole proprietors with a December 31 year end and business income for the year generally pay by April 30 and file by June 15; listed financial institutions have separate rules.
- The CRA assigns your filing frequency when you register, based on your annual taxable sales.
Input tax credits
Input tax credits (ITCs) let you recover the GST/HST you paid on business purchases and expenses. To claim an ITC you need the tax shown on a supporting invoice or receipt, and the purchase must relate to your commercial activities. Common examples include inventory, equipment, software subscriptions and business-use vehicle expenses.
Common GST/HST mistakes
- Not registering once the small-supplier threshold is exceeded — the CRA can assess the uncollected tax.
- Confusing zero-rated supplies, such as basic groceries, with exempt supplies, such as certain financial services — their input tax credit treatment differs.
- Claiming input tax credits without proper invoices or receipts.
- Filing late: the penalty is 1% of the amount owing plus 0.25% per full month late, up to 12 months.
How Accountants Online helps
- Registration for a GST/HST account with the CRA.
- Monthly bookkeeping that feeds each return with complete, reconciled figures.
- Return preparation with input tax credits checked against your invoices.
- E-filing through GST/HST NETFILE and copies stored in your client portal.
Frequently asked questions
When does a business need to register for GST/HST?
For most businesses making taxable supplies in Canada, registration becomes mandatory when worldwide taxable supplies, including associates, exceed $30,000 in a single quarter or over four consecutive quarters. Crossing the limit in one quarter means charging tax on the supply that exceeds it. Crossing over four quarters instead ends small-supplier status after the following month. Special rules apply to some organizations and activities.
How often does a business file a GST/HST return?
The CRA assigns monthly, quarterly or annual reporting periods. Monthly and quarterly returns and payments are due one month after the period ends. Most annual filers have three months; sole proprietors with a December 31 year end and business income generally pay April 30 and file June 15. Nil returns are still required for registered businesses with no activity.
What is an input tax credit?
An input tax credit (ITC) recovers the GST/HST you paid on business purchases. You claim it on your GST/HST return, provided the purchase relates to your commercial activities and you hold a supporting invoice or receipt showing the tax.
What happens if I file my GST/HST return late?
The CRA charges a penalty of 1% of the amount owing plus 0.25% per full month the return is late, to a maximum of 12 months. Interest also accrues on any unpaid balance.
Do I charge GST/HST on everything I sell?
No. Most goods and services are taxable, but some are exempt (such as certain financial and medical services) and some are zero-rated (such as basic groceries and prescription drugs). Exempt supplies are never charged GST/HST and generally do not qualify for input tax credits.